Stuck on the red boxes and the very first PV outlined in Grey.
Homework Answers
| half yearly interest= 1225000*6%*1/2 = 36750 | ||||
| Purchase Price= interest*PVIFA(4%,6)+Principle*PVIF(4%,6) | ||||
| Purchase Price= 36750*5.2421+1225000*0.7903=1160764.68 or 1160783.82 | ||||
| 1)The price paid for the bond OR PV = $1160783.82 | ||||
| 2)The amortisation schedule for the bond is correct | ||||
| 3)Journal entry: | ||||
| Date | Accounts Title | Debit $ | Credit $ | |
| 1-Jan-20 | Bond investment at Amortised Cost | 1160783.82 | ||
| Cash | 1160783.82 | |||
| (being purchase of bond at discount) | ||||
| on Oct 31, 2020: Interest due for 3 months only, therefor journal entry would be: | ||||
| 31-Oct-20 | Interest receivable | 18375 | (36750/2) | |
| Bond investment at Amortised Cost | 5034.31 | (10068.61/2) | ||
| Interest income | 23409.31 | (balancing figure) | ||
| (to record the interest due) | ||||
| 31-Dec-20 | Cash | 36750 | Cash payment of interest | |
| Bond investment at Amortised Cost | 5034.31 | (10068.61/2) | ||
| Interest receivable | 18375 | (contra) | ||
| Interest income | 23409.31 | (balancing figure) | ||
| (to record the interest receipt) | ||||
| 31-Dec-22 | Cash | 36750 | Cash payment of interest | |
| Bond investment at Amortised Cost | 5889.43 | (11778.85/2) | ||
| Interest receivable | 18375 | (contra) | ||
| Interest income | 24264.43 | (balancing figure) | ||
| (to record the interest receipt) | ||||
| 31-Dec-22 | Cash | 1225000 | ||
| Bond investment at Amortised Cost | 1225000 | |||
| (to record the receipt of principle at maturity) | ||||
Add Answer to:
Stuck on the red boxes and the very first PV outlined in Grey. N U E Titles and Explanation Debit Crexit Jan. 1,...
On January 1, 2020, Pharoah Corporation purchased a newly issued $1,525,000 bond. The bond matured on...
On January 1, 2020, Pharoah Corporation purchased a newly issued
$1,525,000 bond. The bond matured on December 31, 2022, and paid
interest at 6% every June 30 and December 31. The market interest
rate was 8%. Pharoah’s fiscal year-end is October 31, and the
company had the intention and ability to hold the bond until its
maturity date. The bond will be accounted using the amortized cost
model.
1. Calculate the price paid for the bond using a financial
calculator...
PRINTER VERSION BACK Question 1 On January 1, 2020, Sandhill Corporation purchased a newly issued $1,225,000...
PRINTER VERSION BACK Question 1 On January 1, 2020, Sandhill Corporation purchased a newly issued $1,225,000 bond. The bond matured on December 31, 2022, and paid interest at 6% every June 30 and December 31. The market interest rate was 8%. Sandhill's fiscal year-end is October 31, and the company had the intention and ability to hold the bond until its maturity date. The bond will be accounted using the amortized cost model. x Your answer is incorrect. Try again....
I'm not sure if my numbers are correct. I am stuck on how to figure out...
I'm not sure if my numbers are correct. I am stuck on
how to figure out the rest of the chart.
Question 1 On January 1, 2020, Sandhill Corporation purchased a newly issued $1,225.000 bond. The bond matured on December 11.2022. and paid interest at 6% every June 30 and December 31. The market interest rate was 8%. Sandhill's fiscal year-end is October 31, and the company had the intention and ability to hold the bond until its maturity date....
On January 1, 2020, Concord Corporation purchased a newly issued $1,225,000 bond. The bond matured on...
On January 1, 2020, Concord Corporation purchased a newly issued
$1,225,000 bond. The bond matured on December 31, 2022, and paid
interest at 6% every June 30 and December 31. The market interest
rate was 8%. Concord’s fiscal year-end is October 31, and the
company had the intention and ability to hold the bond until its
maturity date. The bond will be accounted using the amortized cost
model.
Calculate the price paid for the bond using a financial
calculator or...
On January 1, 2019, Kelly Corporation acquired bonds with a face value of $500,000 for $484,163.65,...
On January 1, 2019, Kelly Corporation acquired bonds with a face
value of $500,000 for $484,163.65, a price that yields a 11%
effective annual interest rate. The bonds carry a 10% stated rate
of interest, pay interest semiannually on June 30 and December 31,
are due December 31, 2022, and are being held to maturity.
Required:
Prepare journal entries to record the purchase of the bonds and
the first two interest receipts using the:
1.
straight-line method of amortization
2....
On January 1, 2019, Kelly Corporation acquired bonds with a face value of $500,000 for $484,163.65,...
On January 1, 2019, Kelly Corporation acquired bonds with a face
value of $500,000 for $484,163.65, a price that yields a 11%
effective annual interest rate. The bonds carry a 10% stated rate
of interest, pay interest semiannually on June 30 and December 31,
are due December 31, 2022, and are being held to maturity.
Required:
Prepare journal entries to record the purchase of the bonds and
the first two interest receipts using the:
1.
straight-line method of amortization
2....
On January 1, 2016, Brand Company purchased bonds with a maturity value of $40,000 for $34,866. These bonds have a 14% per year coupon rate payable semi-annually on June 30 and December 31. The bond matures on December 31, 2020. On January 1, 2016,
On January 1, 2016, Brand Company purchased bonds with a maturity value of $40,000 for $34,866. These bonds have a 14% per year coupon rate payable semi-annually on June 30 and December 31. The bond matures on December 31, 2020. On January 1, 2016, the market yield for bonds of equivalent risk and maturity was 18% per year.RequiredPrepare an amortization schedule that shows the amortized cost of this bond at the end of each of the five years and the amount of interest income...
Exercise 9-14 On July 1, 2020, Bridgeport Aggregates Ltd. purchased 6% bonds having a maturity value...
Exercise 9-14 On July 1, 2020, Bridgeport Aggregates Ltd. purchased 6% bonds having a maturity value of $65,000 for $67,331. The bonds provide the bondholders with a 5% yield. The bonds mature four years later, on July 1, 2024, with interest receivable June 30 and December 31 of each year. Bridgeport uses the effective interest method to allocate unamortized discount or premium. The bonds are accounted for using the FV-OCI model with recycling. Bridgeport has a calendar year end. The...
The following amortization schedule is for Sheffield Ltd.'s investment in Spangler Corp.'s $103,600, five-year bonds with...
The following amortization schedule is for Sheffield Ltd.'s investment in Spangler Corp.'s $103,600, five-year bonds with a 10% interest rate and a 8% yield, which were purchased on December 31, 2019, for $111,873 Bond Premium Amortized Cash Received Amortized Cost Interest of Bonds $111,873 110,463 108,940 107,295 Income Dec. 31, 2019 Dec. 31, 2020 Dec. 31, 2021i Dec. 31, 2022 $10,360 10,360 10,360 10,360 10,360 $8,950 8,837 $1,410 1,523 1,645 8,715 8,584 8,442 Dec. 31, 2023 1,776 105,519 Dec. 31,...
Accounting for Debt Securities- Held-to-Maturity Kurl Company had the following transactuons and adjustments related to a...
Accounting for Debt Securities- Held-to-Maturity
Kurl Company had the following transactuons and adjustments
related to a bond investment:
Accounting for Debt Securities-Held-to-Maturity Kurl Company had the following transactions and adjustments related to a bond investment: 2016 Jan. Purchased $600,000 face value of Sphere, Inc.'s 9 percent bonds at 102 plus a brokerage commission of $900. The bonds pay interest on June 30 1 and December 31 and mature in 10 years. Kuri expects to hold the bonds to maturity. June...
On January 1, 2020, Pharoah Corporation purchased a newly issued
$1,525,000 bond. The bond matured on December 31, 2022, and paid
interest at 6% every June 30 and December 31. The market interest
rate was 8%. Pharoah’s fiscal year-end is October 31, and the
company had the intention and ability to hold the bond until its
maturity date. The bond will be accounted using the amortized cost
model.
1. Calculate the price paid for the bond using a financial
calculator...
PRINTER VERSION BACK Question 1 On January 1, 2020, Sandhill Corporation purchased a newly issued $1,225,000 bond. The bond matured on December 31, 2022, and paid interest at 6% every June 30 and December 31. The market interest rate was 8%. Sandhill's fiscal year-end is October 31, and the company had the intention and ability to hold the bond until its maturity date. The bond will be accounted using the amortized cost model. x Your answer is incorrect. Try again....
I'm not sure if my numbers are correct. I am stuck on
how to figure out the rest of the chart.
Question 1 On January 1, 2020, Sandhill Corporation purchased a newly issued $1,225.000 bond. The bond matured on December 11.2022. and paid interest at 6% every June 30 and December 31. The market interest rate was 8%. Sandhill's fiscal year-end is October 31, and the company had the intention and ability to hold the bond until its maturity date....
On January 1, 2020, Concord Corporation purchased a newly issued
$1,225,000 bond. The bond matured on December 31, 2022, and paid
interest at 6% every June 30 and December 31. The market interest
rate was 8%. Concord’s fiscal year-end is October 31, and the
company had the intention and ability to hold the bond until its
maturity date. The bond will be accounted using the amortized cost
model.
Calculate the price paid for the bond using a financial
calculator or...
On January 1, 2019, Kelly Corporation acquired bonds with a face
value of $500,000 for $484,163.65, a price that yields a 11%
effective annual interest rate. The bonds carry a 10% stated rate
of interest, pay interest semiannually on June 30 and December 31,
are due December 31, 2022, and are being held to maturity.
Required:
Prepare journal entries to record the purchase of the bonds and
the first two interest receipts using the:
1.
straight-line method of amortization
2....
On January 1, 2019, Kelly Corporation acquired bonds with a face
value of $500,000 for $484,163.65, a price that yields a 11%
effective annual interest rate. The bonds carry a 10% stated rate
of interest, pay interest semiannually on June 30 and December 31,
are due December 31, 2022, and are being held to maturity.
Required:
Prepare journal entries to record the purchase of the bonds and
the first two interest receipts using the:
1.
straight-line method of amortization
2....
The following amortization schedule is for Sheffield Ltd.'s investment in Spangler Corp.'s $103,600, five-year bonds with a 10% interest rate and a 8% yield, which were purchased on December 31, 2019, for $111,873 Bond Premium Amortized Cash Received Amortized Cost Interest of Bonds $111,873 110,463 108,940 107,295 Income Dec. 31, 2019 Dec. 31, 2020 Dec. 31, 2021i Dec. 31, 2022 $10,360 10,360 10,360 10,360 10,360 $8,950 8,837 $1,410 1,523 1,645 8,715 8,584 8,442 Dec. 31, 2023 1,776 105,519 Dec. 31,...
Accounting for Debt Securities- Held-to-Maturity
Kurl Company had the following transactuons and adjustments
related to a bond investment:
Accounting for Debt Securities-Held-to-Maturity Kurl Company had the following transactions and adjustments related to a bond investment: 2016 Jan. Purchased $600,000 face value of Sphere, Inc.'s 9 percent bonds at 102 plus a brokerage commission of $900. The bonds pay interest on June 30 1 and December 31 and mature in 10 years. Kuri expects to hold the bonds to maturity. June...
Most questions answered within 3 hours.
-
Where is the error in this code sequence?
String s1 = "Hello";
String s2 = "ello";...
asked 10 months ago -
Financial data for Joel de Paris, Inc., for last year
follow:
Joel de Paris, Inc.
Balance...
asked 10 months ago -
Consider this reaction:
Al2(SO4)3 (aq)+ BaCl3
(aq) Al2Cl6 (aq)- +
3BaSO4(s) . What is the...
asked 10 months ago -
Suppose that Savneet is considering increasing her
recent random sample from 20 car rentals to 40...
asked 10 months ago -
Trucks arrive at an unloading terminal at an average rate of 120
per hour.
Trucks arrive...
asked 10 months ago -
Why are methanol and ethanol completely soluble in water while
octanol is not very little soluble....
asked 10 months ago -
A facilities manager at a university reads in a research report
that the mean amount of...
asked 10 months ago -
When the CuSO4 is rehydrated by adding water to the anhydrous
compound, is this an endothermic...
asked 10 months ago -
A ray of sunlight is passing from diamond into crown glass; the
angle of incidence is...
asked 10 months ago -
A block of mass 0.249 kg is placed on top of a light, vertical
spring of...
asked 10 months ago -
how do the kidneys compensate in the presences of acidosis
a) trigger hyperventilate
b) reserve acid...
asked 10 months ago -
Question 501 pts
The rental rate of capital to the firm increases. Which of the
following...
asked 10 months ago